MOUNT RIDLEY MINES LIMITED — Proxy Solicitation & Information Statement 2013

Sep 2, 2013

AXG MINING LTD ABN 93 092 304 964

NOTICE OF GENERAL MEETING

TIME : 11.00AM (WST) DATE : 4 October 2013 PLACE : Suite G 4 49 Melville Parade South Perth WA 6151

This Notice of Meeting and Explanatory Statement should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting.

Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Company Secretary on (08) 9429 2900.

CONTENTS

Notice of General Meeting (setting out the proposed Resolutions) Explanatory Statement (explaining the proposed Resolutions) Glossary 22 Schedule A – Terms and conditions of Options 23 Proxy Form

TIME AND PLACE OF MEETING AND HOW TO VOTE

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The General Meeting of the Shareholders of AXG Mining Ltd which this Notice of Meeting relates to will be held at :

TIME : 11.00AM (WST) DATE : 4 October 2013 PLACE : Suite G 4 49 Melville parade South Perth WA 6151

YOUR VOTE IS IMPORTANT

The business of the General Meeting affects your shareholding and your vote is important.

VOTING IN PERSON

To vote in person, attend the General Meeting on the date and at the place set out above.

VOTING BY PROXY

To vote by proxy, please complete and sign the enclosed proxy form and return by the time and in accordance with the instructions set out on the Proxy Form.

In accordance with section 249L of the Corporations Act, members are advised that:

• each member has a right to appoint a proxy;

• the proxy need not be a member of the Company; and

• a member who is entitled to cast 2 or more votes may appoint 2 proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the member appoints 2 proxies and the appointment does not specify the proportion or number of the member’s votes, then in accordance with section 249X(3) of the Corporations Act, each proxy may exercise one-half of the votes.

New sections 250BB and 250BC of the Corporations Act came into effect on 1 August 2011 and apply to voting by proxy on or after that date. Shareholders and their proxies should be aware of these changes to the Corporations Act, as they will apply to this General Meeting. Broadly, the changes mean that:

• if proxy holders vote, they must cast all ‘directed’ proxies as directed; and

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• any directed proxies which are not voted will automatically default to the Chair, who must vote the proxies as directed.

Further details on these changes are set out below.

Proxy vote if appointment specifies way to vote

Section 250BB(1) of the Corporations Act provides that an appointment of a proxy may specify the way the proxy is to vote on a particular resolution and, if it does :

• the proxy need not vote on a show of hands, but if the proxy does so, the proxy must vote that way (i.e. as directed); and

• if the proxy has 2 or more appointments that specify different ways to vote on the resolution – the proxy must not vote on a show of hands; and

• if the proxy is the chair of the meeting at which the resolution is voted on – the proxy must vote on a poll, and must vote that way (i.e. as directed); and

• if the proxy is not the chair – the proxy need not vote on the poll, but if the proxy does so, the proxy must vote that way (i.e. as directed).

Transfer of non-chair proxy to chair in certain circumstances

Section 250BC of the Corporations Act provides that, if:

• an appointment of a proxy specifies the way the proxy is to vote on a particular resolution at a meeting of the Company's members; and

• the appointed proxy is not the chair of the meeting; and

• at the meeting, a poll is duly demanded on the resolution; and

• either of the following applies:

• the proxy is not recorded as attending the meeting;

• the proxy does not vote on the resolution,

the chair of the meeting is taken, before voting on the resolution closes, to have been appointed as the proxy for the purposes of voting on the resolution at the meeting.

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NOTICE OF GENERAL ME ETING

Notice is given that the General Meeting of Shareholders of AXG Mining Ltd will be held at:

TIME : 11.00AM (WST) DATE : 4 October 2013 PLACE : Suite G 4 49 Melville parade South Perth WA 6151.

The Explanatory Statement annexed to this Notice of Meeting provides additional information on matters to be considered at the General Meeting. The Explanatory Statement and the proxy form are part of this Notice of Meeting.

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the General Meeting are those who are registered Shareholders at 11:00AM on 2 October 2013.

Terms and abbreviations used in this Notice of Meeting and Explanatory Statement are defined in the Glossary.

AGENDA

1. RESOLUTION 1 – SECTION 195 APPROVAL

To consider and, if thought fit, to pass, with or without amendment, the following Resolution as an ordinary resolution :

“That, for the purposes of section 195(4) of the Corporations Act and for all other purposes, the Directors are hereby approved and authorised to complete the transactions as contemplated in this Notice."

Voting Exclusion : The Company will disregard any votes cast on this Resolution by any of the Directors or Proposed Directors (or any of their associates). However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote in accordance with the directions on the Proxy Form or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

Short Explanation: Approval of Resolutions the various resolutions may result in the Directors or the Proposed Directors having a “material personal interest” in the Option Placement and/or the Share Placement and other matters referred to in this Notice. In the absence of this Resolution, the Directors may not be able to form a quorum at any meetings necessary to carry out various transactions contemplated by this Notice.

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2 . RESOLUTION 2 – APPROVAL OF ISSUE OF SHARES TO MR. GUY T LE PAGE (AND / OR NOMIN EE) IN LIEU OF DI REC TORS FEES

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, for the purposes of ASX Listing Rule 10.11, Chapter 2E and for all other purposes, approval is given for the Directors to allot and issue 11,000,000 Shares to G T Le Page (or his nominee) in lieu of Directors fees payable to Mr. Guy T Le Page on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Mr. Guy T Le Page and any Associate of his. However, the Company need not disregard a vote if the vote is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or the vote is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

3 . RESOLUTION 3 – APPROVAL OF ISSUE OF SHARES TO MR. ROLAND H BERZINS (AND / OR NO MI NEE) I N LIEU OF DI RECTORS FEES

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, for the purposes of ASX Listing Rule 10.11, Chapter 2E and for all other purposes, approval is given for the Directors to allot and issue 44,000,000 Shares to R H Berzins (or his nominee) in lieu of Directors fees payable to Mr. Roland H Berzins on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Mr. Roland H Berzins and any Associate of him. However, the Company need not disregard a vote if the vote is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or the vote is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

4 . RESOL UTION 4 – APPROVAL OF ISSUE OF SHARES TO MR. GORDON A SKLENKA (AND / OR NO MINEE) IN LIEU OF DI RECTORS AND CONSULTING FEES , LOAN REPAY MENTS AND EXPENSE REI MBURSEMENT

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, for the purposes of ASX Listing Rule 10.11, Chapter 2E and for all other purposes, approval is given for the Directors to allot and issue 205,384,000 Shares to Mr. Gordon A Sklenka (or his nominee) in lieu of Directors fees,consulting fees, expense reimbursement and loan repayments payable to Mr. Gordon A Sklenka on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Mr. Gordon A Sklenka and any Associate of him. However, the Company need not disregard a vote if the vote is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or the vote is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

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5. RESOLUTION 5 – APPROVAL OF ISSUE OF SHARES IN LIEU OF FE ES, CHARGES AND LOAN CON VERSION.

To consider and, if thought fit, to pass with or without amendment, the following resolution as an ordinary resolution:

That, pursuant to and in accordance with Listing Rule 7.1 and for all other purposes, Shareholders approve the allotment and issue of 139,500,000 Shares as follows: (a) Charles Ryan (each at a deemed issue price of A$0.001); (b) XTL Energy Ltd (each at a deemed issue price of A$0.001);

as per the following table:

Name	Consulting Fees and loan conversions ($)	Number of Shares	Avg Share Price for Shares issued at $¹	Value of Shares Received at current Share Price $²
Charles Ryan	30,000	30,000,000	$0.001	30,000,000
XTL Energy Ltd	35,000	35,000,000	$0.001	35,000,000
Total	65,000	65,000,000		65,000,000

Note: Shares issued on Closing price 30 June 2013

Shares on the terms and conditions in the Explanatory Memorandum

Voting Exclusion

The Company will disregard any votes cast on this Resolution by a person who participated in the issue and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

The effect of Resolution 10 will be to allow the Company to issue securities, without using the Company’s 15% annual placement capacity set out in ASX Listing Rule 7.1 and the additional 10% annual capacity set out in Listing Rule 7.1A.

6 . RESOLUTION 6 – APPROVAL OF ISSUE OF SHARES TO EDWARDS MOTORS (AND / OR NOMI NEE) I N LIEU OF LOAN

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

“That, for the purposes of ASX Listing Rule 10.11, Chapter 2E and for all other purposes, approval is given for the Directors to allot and issue 74,500,000 Shares to Edwards Motors (or their nominee) in lieu of loans payable to Edwards Motors on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Edwards Motors and Roland Berzins and any Associate of theirs. However, the Company need not disregard a vote if the vote is cast by a person as proxy for a person who is

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entitled to vote, in accordance with the directions on the proxy form or the vote is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

7. RESOLUTION 7 – CONSOLIDATION OF CAP I TAL

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

"That in accordance with section 254H of The Corporations Act, Listing Rule 7.20 and the Constitution and for all other purposes, the Company be authorised to undertake a consolidation of its issued capital on a 1 for 7 basis (Consolidation), with the Consolidation taking effect on a date announced to ASX in accordance with the Listing Rules and with any fractional entitlements being rounded down to the nearest whole number, on the terms and conditions in the explanatory memorandum.”

8. RESOLUTION 8 – ISSUE OF S ECURITIES TO RM C ORPORATE FI NANCE IN RESPECT OF DEBT FINA NCING AGREEMENT FEE

To consider and, if thought fit, to pass, with or without amendment, the following ordinary resolution:

“That for the purposes of ASX Listing Rule 10.11, Chapter 2E and for all other purposes, approval is given for the Directors to issue and allot 15,000,000 shares along with a one for two free attaching Option (being 7,500,000 Options), to RM Corporate Finance, post consolidation, on the terms and conditions set out in the Explanatory Statement.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Mr. Guy T Le Page and any Associate of his. However the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

9. RESOLUTION 9- ISSUE OF CONVERTIBLE NOTE TO RM CORPORATE FI NANCE PTY LTD

To consider and, if thought fit, to pass, with or without amendment, the following ordinary resolution :

“That for the purposes of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Directors to issue Convertible Notes with an aggregate face value of up to $2,500,000 to RM Corporate Finance Pty Ltd (or Nominee), and otherwise on the terms and conditions set out in the Explanatory Statement.”

Voting Exclusion: The Company will disregard any votes cast on Resolution 9 by any person who may participate in the proposed issue and any person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if Resolution 8 is passed and any associate of those persons. However the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

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10. RESOLUTION 10 – PLACEMENT OF SHARES

To consider and, if thought fit, to pass, with or without amendment, the following ordinary resolution :

“That for the purposes of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Directors to issue and allot shares up to that number of Shares, when multiplied by the issue price, has a value of $500,000, on the terms and conditions set out in the Explanatory Statement.” Check pricing clause

Voting Exclusion : The Company will disregard any votes cast on Resolution 10 by any person who may participate in the proposed issue and any person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if Resolution 9 is passed and any associate of those persons. However the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

DATED: 2 September 2013

BY ORDER OF THE BOARD

ROLAND BERZINS COMPANY SECRETARY AXG MINING LTD

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EXPLANATORY STATEMENT

This Explanatory Statement has been prepared for the information of the Shareholders in connection with the business to be conducted at the General Meeting of Global Metals Exploration NL to be held at at :

TIME : 11.00AM (WST) DATE : 4 October 2013 PLACE : Suite G 4 49 Melville parade South Perth WA 6151

The purpose of this Explanatory Statement is to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions which are the subject of the business of the Meeting.

1. RESOLUTION 1 – SECTION 195 APPROVAL

Section 195 of the Corporations Act 2001 essentially provides that a director of a public company may not vote or be present during the meeting of directors when matters in which the director holds a “material interest” are being considered.

All of the directors therefore, may have a material personal interest if they are issued shares in lieu of outstanding monies. In the absence of this resolution, the Directors may not be able to form a quorum at the directors meeting necessary to carry out the allotment of the shares.

The Directors have accordingly exercised their right under Section 195(4) of the corporations Act 2001 to put the issue to the Shareholders to decide.

2. RESOLUTIONS 2, 3 AND 4 – APPROVAL OF ISSUE OF SHARES TO THE DIRECTORS IN LIEU OF DIRECTORS’ FEES , EXPENSE REIMBURSEM ENT, COUNSULTING FEES AND LOAN REPAYMENT

Shares to Directors

The Company proposes to grant a total of 260,384,000 Shares to Directors, or their nominees, for nil consideration in lieu of $260,384 worth of outstanding Management and Directors’ fees payable as follows:

Name	Directors Fees ($)	Management Fees, expenses and loan repayment ($)	Number of Shares	Avg Share Price Shares issued at ($)1	Value of shares received at current Share Price ($)
G T Le Page	11,000	-	11,000,000	0.001	11,000
R H Berzins	44,000	-	44,000,000	0.001	44,000
G A Sklenka	37,400	167,984	205,384,000	0.001	205,384
TOTAL	92,400	167,984	260,384,000		260,384

Table 1: Particulars of Shares issued to Directors

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Notes:

1. The deemed issue price of the Shares is based on the closing price of the Company’s share capital as at 30 June 2013.

Chapter 2E of the Corporations Act – Related Party Transactions

The issue of Shares to the Directors constitutes a grant of a financial benefit to a related party for the purposes of Chapter 2E of the Corporations Act. Chapter 2E of the Corporations Act prohibits the Company from giving a financial benefit to a related party of the Company unless either:

• a) the giving of the financial benefit falls within one of the nominated exceptions to the relevant provisions of the Corporations Act; or

• b) prior shareholder approval is obtained to the giving of the financial benefit.

For the purposes of Chapter 2E, Messrs Le Page, Berzins and Sklenka are related parties of the Company by virtue of section 228(2) of the Corporations Act and the issue of Shares would constitute the giving of a financial benefit. As none of the exceptions set out in the Corporations Act apply, the grant of the Shares to the Directors requires Shareholder approval.

For the purpose of obtaining Shareholder approval, and in accordance with the requirements of Chapter 2E of the Corporations Act, and in particular section 219, the following information is provided to Shareholders to allow them to assess whether or not to approve the issue of the Shares to the Directors under Resolutions 2 to 4.

The Directors therefore consider it prudent to consider that each Director holds a “material personal interest” in the consideration of the matter and so a quorum cannot be formed to consider the matter at Board level. However, by reason of section 195(4) of the Corporations Act, the Directors are permitted in such instances to put the matter before shareholders to resolve. The Directors have accordingly exercised their right under section 195(4) of the Corporations Act and have resolved to place the proposed issue of the Shares to the Directors to Shareholders to consider, and if thought fit, approve.

Identity of the related party to whom the proposed resolution would permit the financial benefit to be given.

Subject to Shareholder approval, the issue of the Shares the subject of Resolutions 2 to 4 will be granted to Directors or their nominees within one month of the passing of these Resolutions. Messrs Le Page, Berzins and Sklenka are Directors of the Company and are therefore classified as related parties.

Nature of, reasons and basis for the financial benefit

The issue of the 260,384,000 Shares is in lieu of $260,384 in accrued Management and Directors’ fees payable to the Directors, repayment of loans from Directors and reimbursement of expenses incurred by Directors. Given the current financial position of the Company the Directors’ consider that the issue of Shares in lieu of management and director fees is a cost effective and efficient means for the Company to conserve cash but remunerate its Directors for their services to the Company and repay past expenses incurred and loans made to the Company.

The deemed issue price of the Shares is based on the closing price of the Company’s share capital on 30 June 2013.

The Directors’ consider this a fair and appropriate way to work out the number of Shares to be issued and the deemed issued price of the Shares to be issued to the Directors in lieu of unpaid Management and Directors’ fees, loans and expense reimbursement.

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Directors’ recommendations to members and reasons

Resolutions 2 to 4 – All of the Directors have an interest in the outcome of Resolutions 2 to 4 and accordingly do not wish to make a recommendation. The Directors do however note that if Shareholders do not approve resolutions 2 to 4 then the Company will be required to pay the fees which will have a significant effect on the current working capital position of the Company.

Dilution as a Result of Resolutions 2 to 4

Number of Shares

Shares currently on issue 665,632,597 Resolutions 2 to 4 – Shares to be issued 260,384,000 New Total 926,016,597 Dilutionary Effect 39.12% Table 2: Issued capital and dilutionary effect

Current Shareholdings of the Directors

Name of Director Shareholding

GT Le Page Nil R H Berzins 2,420,000 G A Sklenka 7,606,013 Share Price history Historical share price information for the last twelve months is as follows: Price Date Highest $0.005 21 September 2012 Lowest $0.001 16 August 2013 (multiple but this is latest date) Last $0.001 16 August 2013

Any other information that is reasonably required by members to make a decision and that is known to the Company or any of its officers.

(a) A voting exclusion statement is included in the Resolutions; and (b) The Shares will be allotted and issued on a date which will be no later than 1 month after the date of the General Meeting.

3. RESOLUTION 5 – APPROVAL OF ISSUE OF SHARES IN LIEU OF CONSULTING FEES, CREDITORS AND LOANS

The Company proposes to grant a total of 65,000,000 shares to consultants and creditors or their nominees, for nil consideration in lieu of $65,000 worth of outstanding consulting fees, creditors and loans payable as follows:

Name	Consulting Fees, Loans & Creditors ($)	Number of Shares	Avg Share Price for Shares issued at $	Value of Shares Received at current Share Price $
Charles Ryan	30,000	30,000,000	$0.001	30,000
XTL Energy Ltd	35,000	35,000,000	$0.001	35,000
Total	65,000	65,000,000	$0.001	65,000

Table 2: Particulars of Shares issued to Consultants and creditors.

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Notes

The deemed issue price of the shares is based on the closing price for the Company’s share capital on the 30 June 2013.

3.1 General

Resolution 5 seeks Shareholder approval pursuant to Listing Rule 7.1 for the issue of up to 65,000,000 Shares each at a deemed issue price as detailed to the Consultants and creditors (or their nominees) as consideration for the provision of the corporate advisory and marketing services and loans to the Company.

Resolution 5 is an ordinary resolution.

3.2 Listing Rule 7.1

Listing Rule 7.1 provides, subject to certain exceptions, that Shareholder approval is required for any issue of securities by a listed company, where the securities proposed to be issued represent more than 15% of the Company's securities then on issue.

As the issue of the Shares to the consultants under Resolution 5 exceeds this 15% threshold and none of the exceptions in Listing Rule 7.2 apply, Shareholder approval is sought in accordance with Listing Rule 7.1.

The effect of Resolution 5 will be to allow the Company to issue 139,500,000 securities to the Consultants, without using the Company’s 15% annual placement capacity set out in ASX Listing Rule 7.1 and the additional 10% annual capacity set out in Listing Rule 7.1A.

Resolution 5 is an ordinary resolution.

3.3 Specific information required by Listing Rule 7.3

For the purposes of the Shareholder approval of the issue of Shares to Charles Ryan and others and the requirements of Listing Rule 7.3, information is provided as follows:

The maximum number of Shares to be issued pursuant to Resolution 5 is 65,000,000 Shares.

The 65,000,000 Shares to be issued pursuant to Resolution 5 will be issued no later than 3 months after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the Listing Rules).

• 3.3.3 The 65,000,000 Shares will be issued for nil cash consideration to the Consultants (and / or their nominees) but rather as consideration for the provision of the consulting fees and loan fees.

• 3.3.4 The 65,000,000 Shares will be issued to the Consultants (or their nominees), who are not related parties or associates of related parties of the Company.

• 3.3.5 The 65,000,000 Shares will be fully paid ordinary shares in the capital of the Company and rank equally to in all respect with the Company’s existing Shares on issue

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• 3.3.6 The 65,000,000 Shares will be issued in consideration for the consulting fees and loan fees provided by the Consultants to the Company and as such no funds will be raised from the issue of the Consultants Shares.

• 3.3.7 All of the 65,000,000 Shares will be allotted on the same date

A voting exclusion statement is included in the Notice

Dilution as a Result of the Resolution 5

Dilution as a Result of the Resolution 5
	Number of Shares
Shares on Issue at 30thJune 2013	665,632,597
Resolution 5: Shares to be Issued	65,000,000
New Total	730,632,597
Dilution Effect	9.76%

4. RESOLUTION 6 – APPROVAL OF ISSUE OF SHARES TO EDWARDS MOTORS (AND / OR NOMI NEE) I N LIEU OF LOAN

The Company proposes to grant a total of 74,500,000 shares to the creditors or their nominees, for nil consideration in lieu of $74,5000 worth of outstanding loans fees payable as follows:

Name	Loans ($)	Number of Shares	Avg Share Price for Shares issued at $	Value of Shares Received at current Share Price $
Edwards Motors	74,500	74,500,000	$0.001	74,500
Total	74,500	74,500,000	$0.001	74,500

Table 3: Particulars of Shares issued to Creditor.

Chapter 2E of the Corporations Act – Related Party Transactions

The issue of Shares to the creditors constitutes a grant of a financial benefit to a related party for the purposes of Chapter 2E of the Corporations Act. Chapter 2E of the Corporations Act prohibits the Company from giving a financial benefit to a related party of the Company unless either:

a) the giving of the financial benefit falls within one of the nominated exceptions to the relevant provisions of the Corporations Act; or

b) prior shareholder approval is obtained to the giving of the financial benefit.

For the purposes of Chapter 2E, Edwards Motors and its nominee Mr R Berzins are related parties of the Company by virtue of section 228(2) of the Corporations Act and the issue of Shares would constitute the giving of a financial benefit. As none of the exceptions set out in

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the Corporations Act apply, the grant of the Shares to the creditors requires Shareholder approval.

For the purpose of obtaining Shareholder approval, and in accordance with the requirements of Chapter 2E of the Corporations Act, and in particular section 219, the following information is provided to Shareholders to allow them to assess whether or not to approve the issue of the Shares to the Directors under Resolution 6.

Mr R Berzins is a director of the Company. The Directors therefore consider it prudent to consider that whilst a Director holds a “material personal interest” in the consideration of the matter, a quorum can be formed to consider the matter at Board level. However, by reason of section 195(4) of the Corporations Act, the Directors are permitted in such instances to put the matter before shareholders to resolve. The Directors have accordingly exercised their right under section 195(4) of the Corporations Act and have resolved to place the proposed issue of the Shares to the Directors to Shareholders to consider, and if thought fit, approve.

Identity of the related party to whom the proposed resolution would permit the financial benefit to be given.

Subject to Shareholder approval, the issue of the Shares, the subject of Resolution 6, will be granted to Edwards Motors or their nominee Mr R Berzins within one month of the passing of this Resolution. Mr R Berzins is a Director of the Company and is therefore classified as related parties.

Nature of, reasons and basis for the financial benefit

With regard to the issue of the 74,500,000 Shares is in lieu of $74,500 in loans payable to Edwards Motors, given the current financial position of the Company, the Directors’ consider that the issue of Shares in lieu of loans is a cost effective and efficient means for the Company to conserve cash but repay its creditor for loans made to the Company.

The deemed issue price of the Shares is based on the closing price of the Company’s share capital on 30 June 2013.

The Directors’ consider this a fair and appropriate way to work out the number of Shares to be issued and the deemed issued price of the Shares to be issued to Edwards Motors and their Nominee Mr R Berzins, a Director of the Company, in lieu of the loan extended to the Company.

Directors’ recommendations to members and reasons

Resolution 6 – Mr Berzins has an interest in the outcome of Resolutions 6 and accordingly does not wish to make a recommendation. The remaining Directors do however note that if Shareholders do not approve resolutions 6 then the Company will be required to pay the loan which will have a significant effect on the current working capital position of the Company.

The remaining directors vote in favour of the resolution

Dilution as a Result of Resolution 6

Number of Shares
Shares currently on issue	665,632,597
Resolution 6 – Shares to be issued	74,500,000
New Total	740,132,597
Dilutionary Effect	11.19%
Table 2:Issued capital and dilutionary effect

Current Shareholdings of the Directors

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Name of Director Shareholding R H Berzins

2,420,000

Share Price history

Share Price history	Share Price history	Share Price history
Historical share price information for the last twelve months is as follows:
Price Date
Highest	$0.005	21 September 2012
Lowest	$0.001	16 August 2013 (multiple but this is latest date)
Last	$0.001	16 August 2013

Any other information that is reasonably required by members to make a decision and that is known to the Company or any of its officers.

(a) A voting exclusion statement is included in the Resolutions.

(b) The Shares will be allotted and issued on a date which will be no later than 1 month after the date of the General Meeting.

5. RESOLUTION 7 – CONSOLIDATION OF CAPITAL

Resolution 7 seeks Shareholder approval for the Company to undertake a consolidation of the number of Shares on issue on the basis that every 7 Shares be consolidated into one Share ( Consolidation ).

The purpose of the Consolidation is to implement a more appropriate capital structure for the Company going forward.

5.1 Consolidation

Resolution 7 seeks Shareholder approval for the Company to undertake a consolidation of the number of Shares on issue on the basis that every 7 Shares be consolidated into one Share (Consolidation). The purpose of the Consolidation is to implement a more appropriate capital structure for the Company going forward.

5.2 Legal Requirements

Section 254H of the Corporations Act enables a company to convert all or any of its securities into a smaller number of securities by a resolution passed at a general meeting. The conversion proposed by Resolution 7 is permitted under section 254H of the Corporations Act.

5.3 Legal Requirements

Section 254H of the Corporations Act enables a company to convert all or any of its securities into a smaller number of securities by a resolution passed at a general meeting. The conversion proposed by Resolution 6 is permitted under section 254H of the Corporations Act.

5.4 Fractional Entitlements and Taxation

Not all Shareholders will hold that number of Shares which can be evenly divided by 7. Where a fractional entitlement occurs, the Directors will round that fraction down to the nearest whole Share.

It is not considered that any taxation implications will exist for Shareholders arising from the Consolidation. However, Shareholders are advised to seek their own taxation advice on the effect of the Consolidation and neither the Company, nor the Directors (or the Company’s

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advisors) accept any responsibility for the individual taxation implications arising from the Consolidation.

5.5 Holding Certificates

From the date of the Consolidation:

(a) all holding statements for Shares will cease to have any effect, except as evidence of entitlement to a certain number of Shares on a postConsolidation basis;

(b) after the Consolidation becomes effective, the Company will arrange for new holding statements for Shares to be issued to holders of those securities; and

(c) it is the responsibility of each Shareholder to check the number of Shares held prior to disposal or exercise (as the case may be).

5.6 Effect on capital structure

The effect which the Consolidation will have on the capital structure of the Company is detailed in the table below. The table assumes shares referred to in Resolutions 2,3,4,5 and 6 have been issued.

en issued.	en issued.	en issued.	en issued.
ISSUEDCAPITAL
Details		Number	Consolidation
Shares		1,065,516,597	152,216,656
Options		12,500,000	1,785,714

Post consolidation AXCO options will be convertible into post consolidation shares on 1:1 basis at an issue price of 2.1 cents per Share.

6. RESOLUTION 8 – ISSUE OF SECURITIES TO RM CORPORATE FINANCE IN RESPECT OF DEBT FINANCING AGREEMENT FEE

6.1 General

Resolution 8 seeks shareholder approval for the issue of 15,000,000 Shares, post consolidation, along with a one for two free attaching Option (being a total of 7,500,000 Options) to RM Corporate Finance (or nominee) in respect of the fee for the Financing Agreement. The value of the fee is $120,000.

A summary of the Financing Agreement can be found in Section 6.3 below.

The effect of Resolution 8 will be to allow the Directors to issue the Shares and options to RM Corporate Finance during the period of three months after the Meeting (or a longer period, if allowed by ASX), without using the Company’s 15% annual placement capacity set out in ASX Listing Rule 7.1 and the additional 10% annual capacity set out in Listing Rule 7.1A.

A summary of ASX Listing Rule 7.1 is set out in Section 6.2 below.

6.2 ASX Listing Rule 7.1

ASX Listing Rule 7.1 provides that (subject to certain exceptions, none of which is relevant here) prior approval of Shareholders is required for an issue of securities if the securities will, when aggregated with the securities issued by the Company during the previous 12 months,

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exceed 15% of the number of shares on issue at the commencement of that 12 month period.

The effect of Resolution 8 will be to allow the Company to issue 15,000,000 shares and 7,500,000 options to the RM Corporate Finance (or nominee), without using the Company’s 15% annual placement capacity set out in ASX Listing Rule 7.1 and the additional 10% annual capacity set out in Listing Rule 7.1A.

6.3 Technical Information Required by ASX Listing Rule 7.1

For the purposes of ASX Listing Rule 7.3, the following information is provided in relation to the issue:

• (a) the maximum number of Shares to be issued pursuant to Resolution 8 will be 15,000,000 plus 7,500,000 options ;

• (b) the Shares and Options will be issued and allotted no later than three months after the date of this Meeting;

• (c) Options will be issued for nil consideration.

• (d) the allottee in respect of Resolution 8 is RM Corporate Finance or a nominee of RM Corporate Finance. The allottees will not be related parties of the Company;

• (e) the Shares allotted and issued will be fully paid ordinary Shares in the capital of the Company and will rank equally with the existing ordinary fully paid Shares on issue, and the Options in accord with the terms and conditions in Schedule A;

• (f) no funds will be raised from this issue as it is in respect of the fee for the Funding Agreement; and

• (g) The benefit associated with the 15,000,000 Share issue would be $105,000 and the benefit associated with the 7,500,000 Option issue would be $15,000, making a total benefit of $120,000. The methodology regarding the Valuation of Options is at Schedule B.

6.4 Chapter 2E of the Corporations Act – Related Party Transactions

The issue of Shares to the creditors constitutes a grant of a financial benefit to a related party for the purposes of Chapter 2E of the Corporations Act. Chapter 2E of the Corporations Act prohibits the Company from giving a financial benefit to a related party of the Company unless either:

• a) the giving of the financial benefit falls within one of the nominated exceptions to the relevant provisions of the Corporations Act; or

• b) prior shareholder approval is obtained to the giving of the financial benefit.

For the purposes of Chapter 2E, RM Corporate Finance and Mr G T Le Page are related parties of the Company by virtue of section 228(2) of the Corporations Act and the issue of Shares would constitute the giving of a financial benefit. As none of the exceptions set out in the Corporations Act apply, the grant of the Shares to the creditors requires Shareholder approval.

For the purpose of obtaining Shareholder approval, and in accordance with the requirements of Chapter 2E of the Corporations Act, and in particular section 219, the following information is provided to Shareholders to allow them to assess whether or not to approve the issue of the Shares and options to the Directors under Resolution 8.

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Mr G Le Page is a director of the Company. The Directors therefore consider it prudent to consider that whilst a Director may hold a “material personal interest” in the consideration of the matter, a quorum can be formed to consider the matter at Board level. However, by reason of section 195(4) of the Corporations Act, the Directors are permitted in such instances to put the matter before shareholders to resolve. The Directors have accordingly exercised their right under section 195(4) of the Corporations Act and have resolved to place the proposed issue of the Shares to the Directors to Shareholders to consider, and if thought fit, approve.

6.5 Identity of the related party to whom the proposed resolution would permit the financial benefit to be given.

Subject to Shareholder approval, the issue of the Shares the subject of Resolution 8 will be granted to Directors or their nominees within one month of the passing of these Resolutions. Mr G Le Page is a Director of the Company and is therefore classified as related parties.

6.6 Nature of, reasons and basis for the financial benefit

With regard to the issue of the 15,000,000 Shares and 7,500,000 Options (post consolidation) in lieu of the fee for the Financing Agreement, given the current financial position of the Company, the Directors’ consider that the issue of Shares and Options in lieu of a fee is a cost effective and efficient means for the Company to conserve cash but repay its creditors for financing fee made to the Company.

6.7 Directors’ recommendations to members and reasons Resolution 8 – Mr G Le Page has an interest in the outcome of Resolution 8 and accordingly does not wish to make a recommendation. The remaining Directors do however note that if Shareholders do not approve resolutions 8 then the Company will be required to pay the fee which will have a significant effect on the current working capital position of the Company.

The remaining directors vote in favour of the resolution

Dilution as a Result of Resolution 8

ISSUEDCAPITAL
Details		Number	Consolidation
Shares		1,065,516,597	152,216,656
Options		12,500,000	1,785,714

Post consolidation AXCO options will be convertible into post consolidation shares on 1:1 basis at an issue price of 2.1 cents per Share.

Number of Shares

Shares currently on issue (post consolidation) Resolution 8 – Shares to be issued New Total Dilutionary Effect Table 2: Issued capital and Dilutionary effect

152,216,656 15,000,000 167,216,656 9.85%

Number of Shares and options

Shares currently on issue (post consolidation) Options currently on issue (post consolidation) Resolution 8 – Shares to be issued Options to be issued

New Total

152,216,656 1,785,714 15,000,000 7,500,000 176,502,370

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14.61%

Dilutionary Effect

Table 3: Issued capital and Dilutionary effect assuming all options are converted to shares.

Current Shareholdings of the Directors

Name of Relate Party Director Shareholding

G T Le Page (post resolution 1 and post consolidation) 1,571,428

Share Price history

Historical share price information for the last twelve months is as follows:

Price Date Highest $0.005 21 September 2012 Lowest $0.001 16 August 2013 (multiple but this is latest date) Last $0.001 16 August 2013

Valuation and Financial benefit

Attached to this Explanatory Statement, in Schedule B, is a detailing of the Black – Schole valuation methodology. As outlined in the Schedule, the value of the options associated with the passing of this resolution is $7,500 and the benefit would be received by Mr G Le Page, a director of the Company.

The benefit associated with the 15,000,000 share issue would be $105,000, plus a further $15,000 benefit associated with the 7,500,000 Options, making a total benefit of $120,000.

Other Directors recommendation

The remaining directors, who have no financial interest in this resolution vote in favour of the resolution.

Any other information that is reasonably required by members to make a decision and that is known to the Company or any of its officers.

(a) A voting exclusion statement is included in the Resolutions.

(b) The Shares will be allotted and issued on a date which will be no later than 1 month after the date of the General Meeting.

7. RESOLUTION 9- ISSUE OF CONVERTIBLE NOTES TO RM CORPORATE FINANCE

7.1 General

Resolution 9 seeks Shareholder approval for the issue of Convertible Notes with an aggregate face value of up to $2,500,000 in accordance with the Convertible Note Placement terms contained within the Capital Raising and Corporate Advisory Mandate (Capital Raising Mandate) to clients of RM Corporate Finance.

The Convertible Note and its conversion forms part of the Capital Raising Mandate as summarised in below.

A summary of ASX Listing Rule 7.1 is set out in section 2.1 above.

The effect of Resolution 9 will be to allow the Company to issue the Convertible Notes pursuant to the Capital Raising Mandate, without using the Company’s 15%

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annual placement capacity set out in ASX Listing Rule 7.1 and the additional 10% annual capacity set out in Listing Rule 7.1A.

The convertible notes will be issued to Corporations Act S708 sophisticated investors.

7.2 Terms of Convertible Notes

The key terms of the Convertible Notes are as follows:

• (a) the term of the Convertible Notes is twenty four (24) months from the date of issue of the first Convertible Note by the holder in accordance with the Capital Raising Mandate;

• (b) the aggregate face value of the Convertible Notes is to be no more than $2,500,000;

• (c) the Convertible Notes will carry an interest rate of 4% per annum payable quarterly. The holder may elect for the interest to be paid in;

(i) Shares (which will be issued at the lesser of $0.007 or 80% of the 5 Trading Day VWAP per Share for outstanding interest) together with one (1) free Option for every two (2) Shares issued; or

• (ii) cash;

• (d) the Convertible Notes will be convertible into Shares at the lesser of $0.007 or 80% of the 5 Trading Day VWAP per Share together with one (1) free Option for every two (2) Shares issued;

• (e) holders of Convertible Notes will have a right to call conversion anytime after the issue of the Convertible Notes;

• (f) the conversion of the Convertible Notes into Shares and Options is not conditional upon further Shareholder approval unless the Convertible Notes are not issued within the time frame approved within this meeting, being twenty four (24) months, pending ASX waiver approval, or three (3) months should no waiver be granted;

• (g) the Company may draw down on the convertible note loan facilities during the availability period, which commences on the day the holder confirms the availability of a convertible note loan facility to the Company and ceases on a date that is no later than 24 months from the date of issue of the first Convertible Note to the holder;

• (h) the Company does not intend to list the Convertible Notes for quotation on ASX and it is not obliged to do so; and

• (i) the Convertible Notes are unsecured.

7.3 Technical information required by ASX Listing Rule 7.1

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to the Note Issue (all numbers below are based on a post Capital Consolidation basis):

• (a) the Convertible Notes will be issued with a total face value of no more than $2,500,000 and are convertible into Shares at the lesser of $0.007 or 80% of the 5 Trading Day VWAP per Share along with one (1) free Option for every two (2) Shares issued;

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• (b) the Convertible Notes will carry an interest rate of 4% per annum payable quarterly in either cash or Shares and Options (at the holder’s election). Any Shares and Options issued pursuant to the interest carried on the Convertible Notes will be issued at the lesser of $0.007 or 80% of the 5 Trading Day VWAP per Share together with one (1) free Option for every two (2) Shares issued;

• (c) the Convertible Notes will be issued no later than three months after the date of this meeting, and it is intended they will be issued progressively as the Company draws down on the Convertible Note facility. In this regard, the Company has applied for a waiver from ASX to permit the Convertible Notes to be issued outside of the normal three month time frame contemplated by ASX Listing Rule 7.1;

• (d) the Convertible Notes will be issued to sophisticated investors, who are not related parties of the Company;

• (e) the Shares issued on conversion of the Convertible Notes will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares; and

• (f) the Options issued upon the conversion of the Convertible Notes will be issued on the terms set out in Appendix A of this Explanatory Statement;

• (g) the Company will make an application for Official Quotation by ASX of all Shares issued upon the conversion of the Convertible Notes;

• (h) the Company will apply for the Official Quotation of the Options on ASX; and

• (i) the Company intends to use the funds raised from the Convertible Notes to fund working capital.

7.4 Risk of voting dilution

The conversion of Convertible Notes into Shares will dilute the interests of Shareholders who do not receive any Shares under the issue.

If Resolution 8 is approved by Shareholders and the Company issues the Convertible Notes, the economic and voting dilution of existing Shares would be as shown in the table below.

ISSUEDCAPITAL				DILUTION	DILUTION
Details		Number	Consolidation	Undiluted	Diluted
Shares	Current	665,632,597	95,090,371	100.00%	18.13%
Resolution 2, 3 & 4	$260,384 @ $.001	260,384,000	37,197,714		7.09%
Resolution 5 &6	$139,500 @ $.001	139,500,000	19,928,571		3.80%
Resolution 8	RM Corporate Finance		15,000,000		2.87%
Resolution9	$2.5m Convertible Note		357,142,857		68.11%
Total Shares			524,359,513		100.00%
Details		Number	Consolidation	Undiluted	Diluted
AXCO		12,500,000	1,785,714	100.00%	0.95%
Resolution 8	RM Corporate Finance		7,500,000		3.99%

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Resolution9	$2.5m Convertible Note		178,571,428		95.06%
Total AXCO			187,857,142		100.00%

AXCO options will be convertible into shares on 1:1 basis at 2.1 cents per share Current shareholders would retain 71.88 % on an undiluted basis upon issue of the shares in Resolutions 2-4

Current shareholders would retain 61.74% on a fully diluted basis upon issue of the shares in Resolutions 2-6

7.5 Directors’ Recommendation

None of the Directors has a material personal interest in the subject matter of Resolution 9. The Board recommends Shareholders vote in favour of Resolution 9 as it will enable the Company to fund its ongoing commitments.

8 Resolution 10 – PLACEMENT OF SHARES

8.1 General

Resolution 10 seeks shareholder approval for the allotment and issue of up to that number of Shares, when multiplied by the issue price, will raise up to $500,000 (Placement).

A summary of ASX Listing Rule 7.1 is set out in section 2.1 above.

The effect of Resolution 10 will be to allow the Company to issue the Placement Shares without using the Company’s 15% annual placement capacity set out in ASX Listing Rule 7.1.

8.2 Technical information required by ASX Listing Rule 7.1

For the purposes of ASX Listing Rule 7.3, the following information is provided in relation to the Placement:

• (a) the maximum number of Shares to be issued pursuant to the Placement will be that number of Shares which, when multiplied by the issue price equals $500,000;

• (b) the Shares will be issued and allotted no later than three months after the date of this Meeting or such later date as approved by ASX;

• (c) the issue price of the Shares will be at a price which is at least 80% of the average market price of the Shares calculated over the last 5 days on which sales in the Shares were recorded before the date on which the issue is made.

• (d) the allottees in respect of Resolution 10 are not, as yet, identifiable, but will be subscribers to be identified by the Company and any brokers appointed by the Company to manage the issue. The allotees will not be related parties of the Company;

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• (e) the Shares allotted and issued will be fully paid ordinary Shares in the capital of the Company and will rank equally with the existing ordinary fully paid Shares on issue; and

• (f) the Company intends to use the funds raised by the Placement towards further gold exploration on its Ridley Range project in Western Australia and for working capital purposes.

8.3 Directors’ Recommendation

None of the Directors has a material personal interest in the subject matter of Resolution 10. The Board recommends Shareholders vote in favour of Resolution 10 as it will enable the Company to raise funds necessary to maintain its operations.

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GLOSSARY

$ means Australian dollars.

ASX means ASX Limited (ACN 008 724 791).

ASX Listing Rules or Listing Rules means the Listing Rules of the ASX and any other rules of the ASX which are applicable while the entity is admitted to the Official List of the ASX, each as amended or replaced from time to time, except to the extent of any express written waiver by the ASX.

Board means the board of Directors.

Capital Raising Mandate means the funding agreement entered into by the Company with RM Corporate Finance for 50 tranches of Convertible Notes of $50,000 to a maximum of $2,500,000.

Company or AXG means AXG Mining Ltd (ABN 93 092 304 964)

Consolidation means the consolidation of the capital of the Company on a 1:7 basis.

Constitution means the constitution of the Company.

Convertible Notes means the convertible notes to be issued to RM Corporate Finance in respect of the Financing Agreement to a maximum value of $2,500,000.

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company.

Explanatory Statement means the explanatory statement accompanying this Notice of Meeting.

General Meeting means the General Meeting of the Company to be held on September 2013.

Notice of Meeting means this notice of meeting, including the Explanatory Statement and the Proxy Form.

Option means an option to acquire a Share in the Company.

Placement has the meaning set out in Section 4

Related Party has the meaning given to it by Section 228 of the Corporations Act 2001(Cth).

Resolution means a resolution to be considered at the General Meeting as contained in the Notice of Meeting.

Share means an ordinary fully paid share in the capital of the Company.

Shareholder means a shareholder of the Company.

WST means Western Standard Time as observed in Perth, Western Australia.

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SCHEDULE A – TERMS AND CONDITIONS OF OPTIONS

Option Terms and Conditions (pre Consolidation)

Exercise price $0.003: expiry date 31 December 2016:

• (a) Each Option entitles the holder to acquire one fully paid ordinary Share in the Company.

• (b) The options have an exercise price of $0.003 (Exercise Price) and will expire at 5.00pm WST 31 December 2016(Expiry Date).

• (c) The Options are exercisable at any time on or prior to the Expiry Date.

• (d) The Options may be exercised by giving notice in writing to the Company (Notice of Exercise), together with payment of the sum of three tenths of a cent ($0.003) per Option exercised. The Options will lapse at 5.00pm WST 31 December 2016. Any Notice of Exercise received by the Company will be deemed to be a notice of the exercise of that Option as at the date of receipt.

• (e) The Options may be transferred by an instrument (duly stamped where necessary) in the form commonly used for transfer of Options at any time until 31 December 2016. This right is subject to any restrictions on the transfer of an Option that may be imposed by ASX in circumstances where the Company is listed on ASX.

• (f) Option holders shall be permitted to participate in new issues of securities on the prior exercise of options in which case the Option holders shall be afforded the period of at least nine (9) business days prior to and inclusive of the record date (to determine entitlements to the issue) to exercise the Option.

• (g) Shares issued on the exercise of Options will be issued not more than fourteen (14) days after receipt of a properly executed exercise notice and application moneys. Shares allotted pursuant to the exercise of an Option will rank equally with the then issued ordinary shares of the Company in all respects. If the Company is listed on ASX it will, pursuant to the exercise of an Option, apply to ASX for Quotation of the Shares issued as a result of the exercise, in accordance with the Corporations Act and the Listing Rules.

• (h) In the event of any reconstruction (including consolidation, sub-division, reduction or return) of the issued capital of the Company, all rights of the option holder will be changed to the extent necessary to comply with the Listing Rules applying to the reconstruction of capital at the time of the reconstruction.

• (i) If there is a bonus issue to shareholders, the number of shares over which the Option is exercisable may be increased by the number of shares which the holder of the Option would have received if the Option had been exercised before the record date for the bonus issue.

• (j) In the event that a pro rata issue (except a bonus issue) is made to the holders of the underlying securities in the Company, the exercise price of the Options may be reduced in accordance with Listing Rule 6.22.2.

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• (k) The Company will apply for the Options to be listed and fully tradeable on the ASX as soon as is practicable after their issue.

• (l) Payment of the Exercise Price shall be in Australian currency made payable to the Company by electronic funds transfer or other means of payment acceptable to the Company. The application for shares on exercise of the Options with the appropriate remittance should be lodged with the Company in the manner provided in the Option certificate.

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SCHEDULE B – VALUATIONS OF OPTIONS

AXG Mining Ltd

Black & Scholes Calculation

Options applicable to Resolution 6

Input				Output
				Calls	Puts
Strike price	$0.015		Option value	$0.002
Share price	$0.007		Delta
Time to expiration (days)	1186		Theta
Volatility (5)	60		Vega
Annual interest rate (%)	2.5		Rho
			Gamma

Volatility Calculation

60%

Cash Rates

RBA Policy Cash Rate: 2.5%

Time to Expiry

1186 days

Share Price

0.7 cents

Exercise Price

1.5 cents

As tabled above, Options are valued at $0.002 per option, implying a total benefit value applicable to the 7,500,00 options of $15,000

Valuation method - The Black & Scholes Model

Black-Scholes model is used to calculate a theoretical call price (ignoring dividends paid during the life of the option) using the five key determinants of an option's price: stock price, strike price, volatility, time to expiration, and short-term (risk free) interest rate.

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PROXY FORM (ignore for now)

APPOINTMENT OF PROXY AXG MINING LTD ACN 092 304 964

GENERAL MEETING

I/We of being a Shareholder entitled to attend and vote at the Meeting, hereby appoint

Name of proxy OR the Chair as my/our proxy

or failing the person so named or, if no person is named, the Chair, or the Chair’s nominee, to vote in accordance with the following directions, or, if no directions have been given, and subject to the relevant laws as the proxy sees fit, at the Meeting to be held at

TIME : 11.00AM (WST) DATE : 4 October 2013 PLACE : Suite G 4 49 Melville Parade South Perth WA 6151

and at any adjournment thereof.

The Chair intends to vote undirected proxies in favour of all Resolutions in which the Chair is entitled to vote.

FOR AGAINST ABSTAIN

Resolution 1 Section 195 Resolution 2 Approval of Shares to G T Le Page in Lieu Resolution 3 Approval of Shares to R H Berzins in Lieu Resolution 4 Approval of Shares to G A Sklenka in Lieu Resolution 5 Approval of Shares to Consultants in Lieu Resolution 6 Approval of Shares to Creditor in Lieu Resolution 7 Consolidation Resolution 8 Approval of Shares to RM Corporate Finance Debt Financing Resolution 9 Approval of Shares to issue Convertible note Resolution 10 Placement of Shares

Please note : If you mark the abstain box for a particular Resolution, you are directing your proxy not to vote on that Resolution on a show of hands or on a poll and your votes will not be counted in computing the required majority on a poll.

If two proxies are being appointed, the proportion of voting rights this proxy represents is

%

Signature of Shareholder(s): Individual or Shareholder 1 Sole Director/Company Secretary	Date: ______ Shareholder 2 Shareholder 3 Director Director/Company Secretary	Date: ______ Shareholder 2 Shareholder 3 Director Director/Company Secretary
		Director/Company Secretary

Contact Name: _____ Contact Ph (daytime): _____

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Instructions for Completin g ‘Appointment of Proxy’ Form

1. ( Appointing a proxy ): A Shareholder entitled to attend and cast a vote at the Meeting is entitled to appoint a proxy to attend and vote on their behalf at the Meeting. If a Shareholder is entitled to cast 2 or more votes at the Meeting, the Shareholder may appoint a second proxy to attend and vote on their behalf at the Meeting. However, where both proxies attend the Meeting, voting may only be exercised on a poll. The appointment of a second proxy must be done on a separate copy of the Proxy Form. A Shareholder who appoints 2 proxies may specify the proportion or number of votes each proxy is appointed to exercise. If a Shareholder appoints 2 proxies and the appointments do not specify the proportion or number of the Shareholder’s votes each proxy is appointed to exercise, each proxy may exercise one-half of the votes. Any fractions of votes resulting from the application of these principles will be disregarded. A duly appointed proxy need not be a Shareholder.

2.

( Direction to vote ): A Shareholder may direct a proxy how to vote by marking one of the boxes opposite each item of business. The direction may specify the proportion or number of votes that the proxy may exercise by writing the percentage or number of Shares next to the box marked for the relevant item of business. Where a box is not marked the proxy may vote as they choose subject to the relevant laws. Where more than one box is marked on an item the vote will be invalid on that item.

3. ( Signing instructions ):

• ( Individual ): Where the holding is in one name, the Shareholder must sign.

• ( Joint holding ): Where the holding is in more than one name, all of the Shareholders should sign.

• ( Power of attorney ): If you have not already provided the power of attorney with the registry, please attach a certified photocopy of the power of attorney to this Proxy Form when you return it.

• ( Companies ): Where the company has a sole director who is also the sole company secretary, that person must sign. Where the company (pursuant to Section 204A of the Corporations Act) does not have a company secretary, a sole director can also sign alone. Otherwise, a director jointly with either another director or a company secretary must sign. Please sign in the appropriate place to indicate the office held. In addition, if a representative of a company is appointed pursuant to Section 250D of the Corporations Act to attend the Meeting, the documentation evidencing such appointment should be produced prior to admission to the Meeting. A form of a certificate evidencing the appointment may be obtained from the Company.

• ( Attending the Meeting ): Completion of a Proxy Form will not prevent individual Shareholders from attending the Meeting in person if they wish. Where a Shareholder completes and lodges a valid Proxy Form and attends the Meeting in person, then the proxy’s authority to speak and vote for that Shareholder is suspended while the Shareholder is present at the Meeting.

• ( Return of Proxy Form ): To vote by proxy, please complete and sign the enclosed Proxy Form and return by:

• (a) post to AXG Mining Ltd; PO Box 1922 West Perth WA 6872 or Suite G4 / 49 Melville Parade South Perth WA 6051;

(b) facsimile to the Company on facsimile number +61 8 9486 1066;

so that it is received not less than 48 hours prior to commencement of the Meeting.

Proxy Forms received later than this time will be invalid.

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